Somali Region Implementation of the EMCP reform projects in Somali region December 2005

2 Structure of Presentation Background of EMCP Objectives and Goals of EMCP Components and Program Management of EMCP Status of Reforms Evolutionary Approach to Reform Benefits of Reform Reform Activities Planned in Somali Region Progress to date Constraints facing Reform Immediate Assistance required from the region Support required from senior officials

3 Background Expenditure Management and Control Sub- Program is one of the five sub programs of the Civil Service Reform

4 Objectives of EMCP To strength the capacity of the public financial management system to manage public sector financial transactions To improve the capacity of public sector managers to use information to permit better planning, management and control To develop on the platform that budget allocations are driven by policy

5 Components of EMCP Legal Framework Budget Reform Accounts Reform Expenditure Planning Internal Audit External Audit Cash Management Financial Management Information System Accounts and Audit Professional Development

6 Program Management National Steering Committee EMCP Coordination Office Regional Steering Committees Regional / Federal Reform Teams

7 Status of Reforms

8  Reform is a process not a product  Contextual with prudent ‘best’ practice  Begin with exiting government systems, improve and innovate  Devolution requires evolution  Reform at the pace of government  IT should support not drive a financial reform Multi-year exp. Planning Performance budgets Financial Statements Mgmt accounting On-line FIS (IBEX) MIS Cost Center Budget Double/E, Mod/Cash Accts BIS/BDA Line Item Budget Single Entry, Cash Accts Spreadsheets FY 89 FY FY 99 Evolutionary Approach to Reform

9 Benefits of Reform Legal framework established Accounts backlog reduced Budget & Accounts manual/module developed and translated (Amharic, Oromiffa, Somali & Tigrigna) Financial Information System developed and used (BIS/BDA) 55,691 staff trained

10 Benefits of Reform…cont’d Standard chart of accounts used Budget structure standardized Improved cash and management control Development partners confidence increased o Direct budget support reporting o Debt write off o Ramping up financial support

11 Improve content and quality of information Provide more timely information Increase transparency Accounts undertaken at single pool Single treasury system developed Reduce costs Modernizes public sector financial systems Meets international standards Benefits of Reform…cont’d

12 Reform Activities Planned in Somali Region Budget Reform – FY 1997/98 Budget Execution – FY 1998 Accounts Reform– FY 1998/99

13 Progress to Date Budget Reform Budget manual and module developed Development of new budget structure Cost center budgeting New chart of accounts used to prepare FY 98 budget Printed & distributed new budget preparation forms

14 Progress to Date… cont’d Region-wide training delivered Over 1,200 budget experts trained FY 98 budget is under preparation Budgets are being processed using BIS

15 Progress to Date …cont’d Budget Execution Single Pool and Single Treasury Systems implemented Budget execution manual/module developed New chart of accounts introduced New forms under print TOT Training delivered

16 Constraints Facing the Reform Delay in approval of blocked grant formula Delayed delivery of budget preparation training Delay in budget approval at region and sub- regional levels Delayed budget execution training Delayed printing of budget execution forms

17 Constraints Facing the Reform Inadequate staff capacity  Number of staff assigned to posts  Low technical capacity Poor infrastructure  Communications  Power  Office space, furniture, equipment, etc Delays in commencement of FY 98 accounts

18 DSA Strategy Conduct a region-wide assessment of the implementation of budget reform Deliver a region-wide budget execution training to strength the wereda Financial Management Provide on the job support to expedite accounts closure Conduct reform awareness workshop for senior officials to strengthen the budget reform implementation to introduce the accounts reform

19 DSA Strategy… cont’d Provide extensive support to weredas Deliver refresher training on budget preparation Design accounts manual and training modules Deliver region wide accounts training Provide post implementation support Install and implement BDA to strengthen the budget reform implementation to introduce the accounts reform … cont’d

20 Immediate Assistance required from the region Procure accounts reform forms well in advance of the accounts reform Recruit qualified accountants at regional and wereda levels Assign qualified accountants to key posts in the Accounts Department Allocate budgetary resources to strengthen the Finance Offices

21 Area of Support Required Office Heads Recruit qualified staff Implement organizational structure Match technical capacity to job requirements Minimize staff reassignments Finance Heads Assign dedicated staff to work on closure of FY 97 accounts Ensure account records are up to date for FY 98 given the delays in commencement of accounts

22 Area of Support Required… cont’d BOFED Should Lead the Reform On: Policy issues Technical issues Management and operational issues

23 Area of Support Required… cont’d To: Enhance quality of the technical design Ensure timely and quality implementation Minimize risk of failure Ensure future sustainability